Online e-Commerce has taken the world by storm. It is a simple, convenient, and instant way of doing business. The increase in consumers, as well as the increasingly high volume of online sales, have helped many small businesses reach great heights in their growth curve, but as with anything, it takes work. There are various aspects that we need to be aware of before starting with a digital marketing strategy.
When we talk about B2C and D2C, it often needs clarification to understand how they differ. Direct to consumer, or direct to customer, is an online marketing model focusing on reaching customers through e-commerce companies and other online channels.
The difference between D2C and B2C is as follows - D2C stands for direct-to-customer, whereas B2C stands for business-to-consumer. D2C is the latest model in the market that helps companies connect with their customers directly. This makes it easier for customers to buy products and services. B2C is a retail model referring to the process of selling goods directly to consumers or end users. B2C brands use their mediums or platforms to market and sell their products or services to customers.
Direct sales products have been around for years. The concept of D2C (direct to consumer) was created in the early 2000s when it became famous, thanks to companies like Nordstrom and Zappos. These companies realized that they could bring their customer base closer by having in-store customer representatives help them select items, helping them find new articles based on past purchases, and so on.
Direct-to-Customer and Business-to-Consumer (B2C), are all business models that allow you to grow your e-Commerce business. B2C is a common term used by retailers and brands. The main difference between Direct to Consumer and Business-to-Consumer is how they treat their customers.
In Direct to Consumer, we are the ones who sell the product directly to our customers. This means we don't have any intermediaries between us and our customers. We are also responsible for delivering the product, providing support, etc.
In the Business to Consumer model, a retailer buys from us and resells it at a higher price point. Direct to Consumer (DTC) is a marketing strategy focusing on building solid customer relationships. It's a strategy used by many health and wellness brands that want to provide people with the tools they need to take control of their health. Retailers and brands use Business to Consumer (B2C).
Some B2C businesses make use of their platforms to market and sell their products. Some other B2C businesses rather generate revenue by connecting buyers to sellers and using content traffic to sell advertisement spaces or restrict content to paid subscriptions.
A Direct To Consumer (D2C) model is a traditional business model, including a manufacturer who sells products to wholesalers, who further sell them to retailers, and finally, the products reach the consumers at a premium price. This sales model goes through heavy negotiations at each production and delivery stage. This, in turn, increases the price of the products and also the time to reach the consumers.
Manufacturers manage everything, ranging from the warehouse to sales and transportation. This model offers advertisement and product sales through digital channels. The manufacturers need to seek out customers and advertise their products to them through all possible channels.
Brands are trying to switch over to the D2C model to exercise full control over their operations. They are planning strategies to sell products directly to customers instead of going through retailers. Consumers have chosen to limit themselves to online shopping, posing problems for brands only operating physical stores.
Unlike D2C business models, a Business to Consumer (B2C) model sells their products and services directly to their customers. Customers are the end users purchasing products or services for their personal use. The B2C business model follows a retail experience of shopping at a local grocery store or purchasing some product from an online store.
The initial investment needed to set up the B2C business is relatively less compared to the D2C model. This is because the major dependency is on third parties for setting up the business. B2C business models focus on targeting their customers based on their purchasing patterns and product preferences. This way, businesses can efficiently cross-sell and upsell the products to their existing client base.
Some of the benefits of D2C are listed in detail as follows:
Better access to valuable customer insights
Control over the brand value and vision
Greater profits and enhanced business agility
Intriguing promotions and sales offers
Some of the benefits of B2C are listed in detail as follows:
Broader reach and higher scalability
Decreased prices and enhanced accessibility
What's the best way to sell our products? We have got two options: business-to-consumer or direct-to-customer. Both of these strategies are viable, but these models have a few key differences. If we are selling a product, we must know which one is right for our growing business model.
Business to Consumer (B2C): In the B2C business model, companies sell products and services using several mediums. They carry out product development and delivery by sourcing products from manufacturers and selling them to consumers through merchants. Therefore, all D2C companies are B2C since they sell products to consumers, whereas all B2C brands are not D2C brands as they may or may not involve middlemen in making their product deliveries. The D2C business model is, in a way, a subset of the B2C business model.
Some of the leading brands applying the B2C business model are Facebook and Amazon as product-centric business models. Consumers can buy products online without the need to visit physical stores. Spotify and Netflix are service-centric business models operating through subscriptions and memberships.
Direct to Customer (D2C): In the D2C business model, manufacturers sell their products directly to consumers without the involvement of any intermediaries. They leverage online stores, store outlets, brand sales channels, etc. The strategy here is to offer manufacturers complete control over the selling procedure. The brands focus on developing products, targeting their customers, and delivering products to them.
Some of the leading brands applying the D2C business model are Glossier - a leading makeup company, leveraging social media channels to draw traction. Hello Fresh is a meal kit company offering consumers to choose from a variety of different food preferences. This company has its own marketing implementation strategies and is popular for fresh ingredients and recipes.
The digital world is growing at a very rapid pace, and so are the needs of the people. The need is directly proportional to the profit the business owners earn. Hence, at Growth Jockey, as we make more revenue, we can expand our business and hire more employees.
Growth Jockey helps businesses with unique customized solutions and opportunities. It helps manage risks and ensure healthy business growth with sustained excellent performance. We function with high-quality strategies and massive flexibility to cater to any type of project within a business.
For decades, many of the products and services we have used have been limited by a manufacturer/distributor/retailer framework. Consumers cannot directly contact or deal with the product suppliers.
For example, if there's a problem with our computer, we need to get the authorized service center and not directly contact the manufacturer. Most product marketing and sales activities happen through a "middle" retailer. The same is valid for services. For example, if we want a haircut, we go to the barbershop and do not directly contact the hairstylists. The middle retailer or service provider plays an essential role in marketing products or services because they have access to customers and can promote them effectively.
B2C and D2C are excellent ways for business owners to reach their customers consistently. There are many benefits; as with any business model, it also has its downsides. No matter what avenue we take, we, at Growth Jockey, keep our customers in mind, and they'll be sure to come back time and time again.
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